Daily Forex Market Preview, 27/02/2018
The U.S. dollar managed to hold its ground on Monday as investors brace for Fed Chair, Powell’s semi-annual testimony to Congress later today. Although Powell hasn’t yet officially chaired any FOMC meetings, his testimony could be seen as a major indicator of how monetary policy will be steered under his governance.
On the economic front, Mario Draghi gave his testimony to the European parliament on Monday. No major references were made to monetary policy. He however said that the central bank needs to remain patient with inflation. In the U.S. new home sales data showed a decline as home sales rose only 593k missing estimates of 655k.
Looking ahead, the economic calendar today is busy. The U.S. durable goods orders data will be coming out and forecasts point to a decline on the headline print. Germany and Spain will be releasing the flash inflation readings while Canada will be releasing its annual budget plans.
GBPUSD 27-02-2018 Intra-day analysis
GBPUSD (1.3953): The British pound closed bearish yesterday despite intraday attempts to push higher. However, with price still trading above the 1.3902 level of support, we expect to see some upside bounce in price. A break down below 1.3902 is required to confirm the decline towards 1.3530. On the 4-hour chart, GBPUSD remains trading within the triangle pattern. We expect price to touch down to the initial support at 1.3902. A break down below this level could validate the downside breakout in the triangle pattern as price action could be seen targeting 1.3530 level.